Direct Line To Growth Mail-marketing Provider Finds Success With Strategy Of Full Service

September 29, 1986|By Sarah Oates of The Sentinel Staff

DAYTONA BEACH — Sometimes Tom Panaggio yearns for the good old days, when he and his brother made deliveries in their cars, when all they had was a handful of clients and he didn't have to wear a tie.

Three and a half years later, their direct-mail service and import business, with 300 clients and expectations of $15 million in sales this year, produces 275,000 to 400,000 pieces of mail a week.

The rapid growth came after the company, U.S. Trade Distributors Inc., expanded from strictly time-share sales to full-service, direct-mail marketing. Company president Mike Panaggio, 34, predicts the company will reach $100 million in sales in five years.

U.S. Trade Distributors is settling into a new $1.2 million building, which already has a warehouse brimming with luggage, stuffed animals and reams of brochures and other marketing items.

In conducting a direct-mail campaign for a client, the family-held company will provide an array of services, from designing a promotional letter to manufacturing incentive gifts, arranging travel packages and doing the mailing.

In promoting a hotel, Mike Panaggio told what his strategy might be: To accent the hotel as a place where one could ''sleep like a bear,'' he would offer as a gift a teddy bear wearing a nightcap to the first 5,000 visitors as well as low air fare to the location as a bonus.

Also, Panaggio said, his art department would design a logo while the mail department prepared a letter and arranged appropriate mailing procedures through the use of a computerized system. As well, Panaggio would contract with his Korean factory, of which his company owns a half-interest, for production of a customized stuffed animal. A travel agency, owned by the company, would provide a package deal on the air fares.

The company owns a mainframe computer, printers, mail bursters, decollaters, labelers, inserters, folders and postal meters, Panaggio said. He added that he hopes to pay off a 15-year mortgage on the new building in a few years.

Panaggio has stayed away from broadcast and newspaper advertising, instead depending on a more personal touch to marketing. He approaches companies individually to win their business, often through the means on which his company relies -- mailings.

U.S. Trade Distributors signed up several airlines for large mailings after Panaggio wrote directly to airline executives, suggesting changes in their mailings and offering a low rate with overnight service.

''We've never had the opportunity to advertise. We've just never had the time,'' he said. Panaggio said he spends about 10 days each month in Seoul to oversee the Korean operation.

Norbert Tuseo, president of Interval Sun State Marketing in St. Augustine, said U.S. Trade Distributors has won about 80 percent of his business for direct-mail campaigns for selling time-share deals. He said the company offers lower prices then competitors and allows Interval Sun State to store inventory at U.S Trade's facilities until he needs them. U.S. Trade also impressed him because the company is willing to exchange products if one incentive gift is not drawing enough interest from clients.

''The other companies are good -- but they can't do the job that U.S. Trade does,'' he said.

Meanwhile, business remains brisk. While moving into its new building on Labor Day weekend, U.S. Trade put out 60,000 two-page letters for People Express to explain that one of the airline's subsidiaries had gone bankrupt. U.S Trade completed the task in 12 hours and charged People Express about $21,000.

The Panaggios were drawn into the direct-mail business while they were commodities traders in Rochester, N.Y. A client who was struggling with a failing time-share project in Daytona Beach asked Mike Panaggio to travel to Florida to help revive the project in 1982.

He did so reluctantly, utilizing what other time-share operations were relying on -- direct mail -- to promote the development. The response made his move worthwhile. The condominium, Sunrise Beach Club, sold out and so did the next project.

''It's a dramatic, extremely effective way to advertise something,'' said vice president Tom Panaggio, who directs marketing for the company.

U.S. Trade's direct-mail promotions usually arrive in eye-catching envelopes, holding out the lure of gifts or travel discounts, as they urge recipients to take advantage of ''once-in-a-lifetime'' time-share deals or a visit to Central Florida hotels.

''Nine times out of 10 the messages are kind of hokey,'' said Tom Panaggio, who has written many of the letters. ''Grammatical licenses are pretty wide.'' In addition to direct-mail, U.S. Trade also sells other services, offering to prepare large mailings for corporations or producing an astronaut doll for NASA at its Korean factory.